Largest renewable energy investment in Blackstone history -- €1.2Bn with a significant equity component

This month, Blackstone announced the financial closing for “Meerwind,” the largest German offshore wind farm to complete its full financing process. The successful financial close of Meerwind helped demonstrate that privately financed projects of this scale are possible and that private capital can play a critical role in accelerating Germany’s shift from legacy fuel types to clean, renewable energy.

The Meerwind project was made possible by the German regulatory framework for offshore wind, which is one of the best designed and practical renewable programs in the world. The long-term, fixed feed-in tariff and a requirement that the local grid operator must construct and pay for the interconnection of the wind park to the onshore grid (20%+ of total project costs) are innovative ways in which the government is incentivizing private investment. Meerwind is the first project to close under the recently unveiled KfW-sponsored Offshore Wind Programme. This visionary program, developed by the German government, is designed to help replace the ~25,000 megawatts of power needed as a result of the recent announcement that Germany is retiring its entire fleet of nuclear power plants by 2022 in the wake of the Fukushima nuclear tragedy in Japan.

The 80 turbine wind farm will be situated approximately 23 km off the German island of Helgoland in the North Sea and will utilize Siemens 3.6MW wind turbines. Construction of the 288MW offshore wind farm will be completed in 2013. Once finished, Meerwind will produce sufficient power to service approximately 400,000 households and will help Germany eliminate approximately one million tons of carbon emissions per year. 2,000+ jobs will be created in various German locations to manufacture the 100,000 tons of equipment needed for the wind farm. Following construction, Meerwind will employ 80 highly skilled people to operate and maintain the field.

Largest Renewable Energy Investment in Blackstone History

In 2008, a small team from Blackstone traveled with German businessman Peter Giller to explore the development of offshore wind parks in Germany. On this trip, Blackstone met with owners of German offshore wind park permits, equipment suppliers, financing sources and government officials. Giller, a distinguished power industry executive, believed that the German government would soon need to focus on offshore wind to meet its ambitious renewable energy goals.

Shortly thereafter, funds managed by Blackstone acquired the 80-turbine “Meerwind” permit from Windland, one of the first dedicated wind power developers in Germany. WindMW was established in 2008 as a Blackstone portfolio company with Giller at the helm to develop German offshore wind farms. Blackstone, Giller and a small engineering team devoted three years to developing the project, engaging in supplier negotiations and executing the project’s financing.

Accelerating Germany’s Shift to Renewable Resources

Concurrent with the Meerwind financial closing, Blackstone announced the acquisition of a permit to construct the Nördlicher Grund offshore wind farm. The 64 turbine wind farm with an estimated construction cost of €1.3 billion will be situated approximately 100 km off the German coast in the North Sea. Construction is expected to commence in 2013, with completion in 2016. WindMW and its talented management team represent a unique platform behind which Blackstone’s funds will continue to invest significant capital and the Nördlicher Grund acquisition reaffirms Blackstone’s commitment to actively contribute to the acceleration of Germany’s shift from legacy fuel types to renewable resources.

About Blackstone

Blackstone (NYSE: BX) is one of the world’s leading investment and advisory firms and is an experienced and active investor in the energy and natural resources sector. Funds managed by Blackstone have invested/committed approximately $5 billion in the sector to-date across 4 continents.

Blackstone seeks to create positive economic impact and long-term value for our investors, the companies we invest in, the companies we advise and the broader global economy. We do this through the commitment of our extraordinary people and flexible capital. Our alternative asset management businesses include the management of private equity funds, real estate funds, hedge fund solutions, credit-oriented funds and closed-end mutual funds. The Blackstone Group also provides various financial advisory services, including financial and strategic advisory, restructuring and reorganization advisory and fund placement services. Further information is available at www.blackstone.com. Follow us on Twitter @Blackstone.

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Blackstone

Blackstone is one of the world’s leading investment and advisory firms. We seek to create positive economic impact and long-term value for our investors, the companies we invest in, the companies we advise and the broader global economy. We do this through the commitment of our extraordinary peop...